Myanmar Wants Pipeline Through NE India

Myanmar is keen to step up military ties with India, which would also gain by keeping an eye on China’s expansion into the area.

Myanmar is eager to have a natural gas pipeline to India laid along a longer route through northeast India, bypassing Bangladesh. This, according to a Myanmar diplomat, would help Yangon forge closer economic and defense ties with New Delhi.

Though Bangladesh is talking of reviving the stalled tri-nation gas pipeline project by diluting India’s status to a buyer from that of a strategic partner, Yangon wants India to go forward with the alternative route as it would get a $20 million soft loan and a power station, the diplomat said.

Dhaka (capital of Bangladesh) recently said it must be allowed to import electricity from Nepal and Bhutan through India, and India must allow it to correct the trade imbalance if the pipeline is to pass across Bangladesh.

Following this, India backed out of the $1 billion plus project, saying that bilateral issues should not be a part of a trilateral agreement.

According to Indian journalist Indronil Roychowdhury, India, Bangladesh and Myanmar had signed the agreement in February 2005.

In 2006, GAIL India Ltd. said it had completed a feasibility study for laying a 870 mile (1400 km) pipeline at a cost of $3 billion from Sittwe in Myanmar to Gaya in Bihar via Mizoram, Assam and West Bengal.

According to officials, the pipeline would be constructed along the banks of Myanmar’s Kaladan river, an area with a population of over 1 million, of which 98 percent do not have access to electricity.

In case India agrees to this pipeline, its Exim bank would extend Yangon a soft credit loan of $20 million and set up a power plant there.

Myanmar is keen to step up military ties with India, which would also gain by keeping an eye on China’s expansion into the area.

Sources said the negotiations are going on between India and Myanmar over the gas pricing and an agreement is expected by mid-2007.

Myanmar has also signed a deal with Petro China, under which it would get a soft loan of $84 million in return for allowing the 1480 mile (2380 km) pipeline to China’s Yunan province.

Sources said Dhaka, which also sits on large hydrocarbon reserves, is trying to favor Myanmar since the country can offer Bangladesh a corridor to China, the other possible buyer in the region.

Myanmar has natural gas reserves of over 90 trillion cubic feet across 19 onshore and three major offshore fields, making it a center of attraction for countries like India, China, South Korea, Thailand and Singapore, all who are in the race, the officials said.